Offering you an opportunity to make all your dreams come true or to deal with an emergency without any financial stress, HDFC Bank personal loan can be availed for amounts starting at Rs. 50,000 and up to Rs. 40 lakh. The interest rate for these loans starts at as low as 10.75% p.a. These loans are offered with a flexible tenure varying from 12 to 60 months.
Table of Contents:
- Interest Rates
- Interest Rate for all Loan Types
- Reducing Interest Rate Vs Flat Interest Rate
- EMI Calculation Using Reducing Interest Rate
- EMI Calculation Using Flat Interest Rate
- Interest rate calculation
- HDFC Personal loan Interest Rate Comparison
- How to get low interest rates on HDFC Bank Personal Loan
- Factors affecting Interest Rates
- FAQs
HDFC Personal Loan Interest Rates
The rate of interest for HDFC Bank personal loans ranges between 10.75% to 21.30% p.a. Specific interest rate however depends upon the applicant’s credit score, bank’s internal criteria, etc. The bank currently offers personal loans to salaried individuals across government institutions and corporates. Key factors that influence the interest rates of HDFC Bank’s personal loans include type of employer and income of the applicant.
Interest Rate for Different Types of HDFC Personal Loan
Currently, the bank does not categorize its personal loan offers based on either end use or applicant type. Thus in all cases loan interest for HDFC Bank starts at 10.75%.
Balance Transfer Interest Rates
Borrowers have the option to transfer their existing personal loan with other bank to HDFC Bank at a lower rate of interest by completing a balance transfer. The balance transfer interest rate starts at as low as 10.75% p.a.
HDFC Reducing vs. Flat Balance Method of Interest Calculation
Flat Balance method of interest calculation implies that interest is calculated on the full loan principal amount during the entire loan tenure. On the other hand, diminishing/reducing balance interest calculation implies that interest is calculated only on the outstanding loan amount every month. Therefore, as the outstanding loan amount decreases every month, the interest accrued also decreases. Thus, total interest payout is lower in case of reducing balance method as compared to the flat balance method of interest calculation. HDFC Bank uses reducing interest rate to calculate the interest payable on personal loans. As a result, the interest amount decreases as the outstanding loan amount decreases every month.
EMI Calculation Using the Reducing Balance Method of Interest Calculation
The following table depicts the monthly EMIs calculated using the reducing balance method of interest calculation for different loan tenures and interest rates:
| Loan Amount (Rs.) and Interest Rate | Monthly EMI Payout (Rs.) | ||||
| 1-year loan tenure | 2-year loan tenure | 3-year loan tenure | 4-year loan tenure | 5-year loan tenure | |
| 1 lakh @ 11% p.a. | Rs. 8,838 | Rs. 4,661 | Rs.3,274 | Rs. 2,585 | Rs. 2,174 |
| 5 lakh @ 13% p.a. | Rs. 44,659 | Rs. 23,771 | Rs. 16,847 | Rs. 13,414 | Rs. 11,377 |
EMI Calculation Using Flat Balance Method of Interest Calculation
The following table depicts the monthly EMIs calculated using the flat balance method of interest calculation for different loan tenures and interest rates:
| Loan Amount (Rs.) and Interest Rate | Monthly EMI Payout (Rs.) | ||||
| 1-year loan tenure | 2-year loan tenure | 3-year loan tenure | 4-year loan tenure | 5-year loan tenure | |
| 1 lakh @ 11% p.a. | Rs. 9,250 | Rs. 5,083 | Rs. 3,694 | Rs. 3,000 | Rs. 2,583 |
| 5 lakh @ 13% p.a. | Rs. 47,083 | Rs. 26,250 | Rs. 19,306 | Rs. 15,833 | Rs. 13,750 |
HDFC Personal Loan Interest Calculation
The table below illustrates the different loan EMIs calculated using different interest rates and loan tenures:
| Loan Amount (Rs.) and Interest Rate | Monthly EMI Payout (Rs.) | ||||
| 1-year loan tenure | 2-year loan tenure | 3-year loan tenure | 4-year loan tenure | 5-year loan tenure | |
| 1 lakh @ 11% p.a. | 8,838 | 4,661 | 3,274 | 2,585 | 2,174 |
| 5 lakh @ 13% p.a. | 44,659 | 23,771 | 16,847 | 13,414 | 11,377 |
| 10 lakh @ 15 % p.a. | 90,258 | 48,487 | 34,665 | 27,831 | 23,790 |
Interest Rate Comparison of HDFC Personal Loan with Others
A comparison of the key features of a personal loan from HDFC Bank with other top lenders in India is given below:
| Particulars | HDFC Bank | Citi Bank | Axis Bank | ICICI Bank | State Bank of India |
| Interest Rate | 10.75% to 21.30% | Starting from 10.50% | 11.49% to 17.49% | 11.25% to 22.00% | From 12.50% onwards |
| Tenure | 12 to 60 months | 12 to 60 months | 12 to 60 months | 12 to 60 months | 12 to 72 months |
| Loan amount | Up to Rs. 40 lakh | Up to Rs. 30 lakh | Rs. 50,000 to Rs. 15 lakh | Up to Rs. 20 lakh | Up to Rs. 2o lakh |
| Processing Fee | Up to 2.50% of the loan amount | Up to 3% of the loan amount | 2% of loan amount plus GST | Up to 2.25% of loan amount plus GST | Up to 1% of the loan amount |
How to Get Low Interest Rates on HDFC Bank Personal Loan?
You can avail personal loan from HDFC Bank at low interest rates if the following apply to you:
- Ensure you have minimal debt at the time of loan application
- Pay your credit card bills and loan EMIs on time to maintain
- Apply for a loan with your existing banker (e.g. the bank where you)
- Be a permanent government employee with a long employment track record
Factors affecting Interest Rates
Some applicant-specific factors affecting personal loan interest rate of HDFC are given below:
- Credit Score: Credit score indicates your credit behaviour and repayment capacity. A score closer to 900 is considered to be a good score. A high credit score generally leads to the applicant being charged a lower interest rate and vice versa.
- Age of the Applicant: The applicant’s age also affects the interest charged by the lender. For instance, the closer you are to retirement, higher is the interest rate.
- Income: Lenders take into consideration the applicant’s income when deciding the interest rate. Applicants with higher incomes are usually offered a lower rate of interest as they pose a lower risk to the lender. Whereas, applicants with lower annual incomes may be charged a higher rate of interest.
- Employment Details: Lenders may offer personal loans at a lower interest rate if the applicant works with a reputed organisation. Also, the interest rate may vary with the nature of employment of the applicant- whether he/she is self-employed or salaried.
- Relationship with the bank: In case you have an existing relationship with the bank, you may be charged a lower rate of interest at the time of applying for a personal loan.
FAQs
Q1. What is HDFC personal loan interest rate per annum?
The rate of interest on HDFC bank personal loans ranges between 10.75% to 21.30% p.a.
Q2. How is interest payable by a particular applicant determined?
The interest charged by HDFC for its personal loans depends upon several factors like the loan amount, the person’s credit score, the applicant’s income, existing relationship with the bank, etc.
Q3. How much interest is charged by the bank in case I opt for a personal loan balance transfer to HDFC bank?
The personal loan balance transfer interest rate starts as low as 10.75% p.a. However, specific interest rate depends upon several factors like the loan amount, tenure, etc.
Q4. How can I repay HDFC Bank Personal Loan?
HDFC Bank personal loan can be easily repaid in EMIs. The same can be done through post-dated cheques, ECS or via standing instructions to debit your HDFC Bank account with the EMI amount.
Q5. Can I prepay my HDFC Bank Personal Loan?
Yes, you can prepay your loan in full any time after paying the 12 EMIs along with the applicable foreclosure charges. You can foreclose the loan by issuing a Demand draft/ cheque at the branch.
Q6. Can self-employed individuals apply for a personal loan from HDFC Bank?
No, at present HDFC bank only offers personal loans to salaried individuals meeting the eligibility criteria. However, self-employed individuals may be eligible for a business loan from the bank.
Q7. What are the different types of personal loans available with HDFC bank?
At present HDFC bank does not offer multiple types of personal loans. However, the personal loan offered by the bank can be utilised to meet various financial needs like medical/travel expenses, home renovation, etc.
Q8. What are the factors which affect the amount of EMI to be paid on a personal loan?
The EMI amount depends upon the interest rate charged by the bank, the loan tenure and principal amount borrowed.
Q9. What will happen in case I miss an EMI?
In case you miss an EMI, you will be charged a late payment fee along with penal interest on the applicable repayment amount. Defaulting on timely EMI payments may also affect your credit score in the long run.
Q10. Can I change the mode of repayment for a personal loan?
Yes the mode of repayment/ account for a personal loan can be changed. To do so, a pay order, cheque or Demand Draft of Rs. 500 + GST in favour of “HDFC Bank Ltd Loan Account No.” along with the revised set of repayment instructions needs to be submitted.